SoFi Short Report Prompts CEO Stock Purchase
SoFi short report by Muddy Waters drew a rebuttal, legal threat, and CEO Anthony Noto's Mar. 17 purchase raises scrutiny and may boost trading volatility.
KEY TAKEAWAYS
- SoFi rebuked a Muddy Waters short report as inaccurate and said it intends to explore legal action.
- CEO Anthony Noto had purchased 28,900 shares at $17.32, raising holdings to 11,704,352 shares.
- Muddy Waters alleged 6.1% charge-offs, $312M off-balance-sheet debt and $251M of unrecorded liabilities.
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A short report on SoFi Technologies Inc. (SOFI) by Muddy Waters Research triggered a company rebuttal threatening legal action, while CEO Anthony Noto disclosed a share purchase that increased his stake. These moves have intensified scrutiny of the lender’s balance-sheet practices.
SoFi Rebukes Muddy Waters and CEO Buys Shares
SoFi said in a press release at 7 p.m. ET that the Muddy Waters report was factually inaccurate and misleading. The company said it intends to explore potential legal action in response, accusing the report of demonstrating a fundamental misunderstanding of its financial statements and business. The statement added that the report appeared designed to benefit short sellers and disclosed an intent to cover shorts after publication. No new forward guidance or regulatory notices accompanied the statement.
A Form 4 filing with the SEC showed CEO Anthony Noto purchased 28,900 shares that day at an average price of $17.32 per share, spending $500,548 and raising his holdings to 11,704,352 shares.
Muddy Waters Allegations
Muddy Waters published its short report titled "MW is Short SoFi Technologies, Inc. (SOFI US)" on March 17. The report disclosed a short position and alleged that SoFi’s personal-loan charge-off rate is about 6.1%, more than double the company’s reported 2.89%. It claimed roughly $312 million of debt related to loan dispositions was kept off the balance sheet and that the loan-platform business concealed about $251 million of unrecorded liabilities in 2025. The report described SoFi as operating "a financial engineering treadmill" rather than a healthy origination business.
Together, SoFi’s rebuttal and Noto’s insider purchase provide immediate, document-backed signals for investors and analysts to reassess the company’s near-term risk profile.
